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Employee Moving Assistance

We have an employee who applied for a Job at our Corporate headquarters and we hired him. He has a house to sell but we don't offer relocation packages since the economy went down hill.

The employee is asking if we can assist him with any of his closing costs which is he sells his house
will be around 15K. I guess he nneds the proceeds for his down payment on a new home.

So what we were thinking about was to offer him a loan possibly to pay for his closing costs and then when he files his taxes we would ask him to file a return with and without the moving expenses deduction , deduct the difference from the loan and have him pay us back or make him whole.

Any other suggestions? We don't want to pay the real estate broker directly on behalf of the employee because that is totally taxable. Right?

Or pay the Real Estate broker through accounts payable and add as taxable income to his last paycheck -
then make him whole when he files his taxes.


  • I see the point that says 'we hired him.' I guess I do not understand how the potential of 15k wasn't discussed prior to his accepting the position. Did he start asking after he accepted, or was this discussed during negotiations?

    I would be very very careful instructing an employee how to file his 1040, whether he files his taxes or not should not be the concern of the company.

    You could make an agreement with him that he can get 15k as an advance on his annual bonus if he has one, or he gets the 15k now and that makes him not eligible for a bonus this year.

    You can also make the same argument he is making, economy tanked so he needs help with housing. Your side would be economy tanked, we do not offer relocation.
  • I know - it should have been discussed but it wasn't. This person was relocated back in 2006 when we did have money to offer relocation assistance. I'm not sure if he just assumed we would or not. I think he just wanted to get the job and worry about the reloc part later - I'm in the tail end of this as usual. So i'm just trying to help them go in the right direction before they offer this guy something that cost them a boat load more than they thought.
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